Aeropostale raises 4th-quarter outlook on strong sales, and stock rises aftermarket

MarketsAssociated Press

Shares of teen retailer Aeropostale jumped in aftermarket trading Monday after the company reported stronger-than-expected sales in the fourth quarter.

Aeropostale, which along with other teen retailers has struggled to reverse declining sales, said its net sales fell 11 percent to $594.5 million in its fourth quarter. But it said sales, profit margins, and expenses were nonetheless better than expected.

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The company said it is now forecasting an adjusted loss of 1 cent to 6 cents per share for the fiscal quarter. It had earlier projected a loss of 25 cent to 31 cents per share.

FactSet says analysts were expecting a loss of 28 cents per share on $579.4 million in total revenue. The company is due to report its fourth-quarter results on March 12.

Shares of New York-based Aeropostale rose 60 cents, or 22.7 percent, to $3.24 in aftermarket trading. The stock has plunged 60 percent over the last 12 months, through the close of regular-session trading Monday.

Aeropostale Inc. said sales at locations open at least a year fell 9 percent during the quarter, roughly in line with analysts' expectations. Sales at stores open at least a year are considered an important measurement of retailer health because they exclude results from stores that opened or closed within the last year.

Teen retailers have been looking to reposition themselves in the face of changing fashion tastes among teens and fewer shoppers in the mall. They face intense competition from "fast-fashion"retailers like Forever 21 and H&M, which offer a wide and quickly changing array of clothing at low costs.